Jan 17, 2022Should a Startup Allow Early Exercise of Stock Options?by Greg Miaskiewicz Startups that allow the early exercise of stock options help minimize their employees’ tax liabilities and increase the return on common stockholder equity. At Capbase, we believe there is no downside to a new company permitting the early exercise of stock options as part of their equity…Startup Lessons6 min readStartup Lessons6 min read
Jan 17, 2022What is Stock Dilution?by Bryce Warnes When a company authorizes new stock, the value of the existing stock is reduced. This is called stock dilution (or share dilution). Covered in this article: Why stock dilution occurs (with an example) Common causes of stock dilution Stock dilution due to SAFEs (with example) Anti-dilution provisions…Startup Lessons9 min readStartup Lessons9 min read
Dec 17, 20219 Common Legal Mistakes Made By Startups and How To Avoid ThemWhen launching a new startup, many founders make big legal mistakes that can be hugely costly down the road. Startups that make these mistakes can find their companies embroiled in lawsuits and, in some cases, will be unable to raise money from venture capital firms to get the capital they…Startup Lessons11 min readStartup Lessons11 min read
Dec 15, 2021How To Prepare Your Startup For Due Diligenceby Stefan Nagey If you plan on raising money for your startup, due diligence is about to become a big part of your life — whether you want it to or not. But if the due diligence involved with startup fundraising seem complex, have no fear. Broken down into individual…Startup Life10 min readStartup Life10 min read
Dec 15, 2021How to Register a US Company from India in 10 Minutesby Bryce Warnes To register a company in the US from India, you do not need a US mailing address. You don’t have to be a US resident or visa holder, either. In fact, for citizens of India, the process of registering a Delaware corporation is the same as it…Startups In India5 min readStartups In India5 min read
Dec 9, 2021What is a Startup Syndicate and How Does it Work?by Greg Miaskiewicz Syndicates are a quick, clean way to raise capital for your startup. You get access to funds from a wide variety of investors, without having to track them individually on your cap table. That makes later funding simpler, and reduces legal work. Syndicates can also connect you…Startup Lessons5 min readStartup Lessons5 min read
Nov 29, 2021How Many Shares Should a Startup AuthorizeSo you’re ready to incorporate your startup, which means you’re looking to hire engineers, start selling product, and ultimately get investment dollars. How many shares should a corporation start with? The quick and dirty answer is enough shares. Enough shares to satisfy the founders, enough for a pool for employee…Startup Lessons5 min readStartup Lessons5 min read
Nov 29, 2021Why Do Startups Incorporate in Delaware?If you’re based in another country or state, you might be wondering if there’s a reason to register your company as a Delaware corporation instead of just creating a simple LLC where you live. The short answer, especially if you’re planning to grow your company and secure outside funding, is…Startup Lessons4 min readStartup Lessons4 min read
Nov 29, 2021How To Split Equity Among Co-FoundersCo-founder disputes are the number one killer of new companies — Harvard research indicates they’re responsible for as many as 65% of all startup failures. Disagreements over the division of startup equity can turn into a wedge that drives co-founders apart at record speed, generating hurt feelings at best and…Startup Lessons6 min readStartup Lessons6 min read
Nov 29, 2021How to Find the Right Co-Founder for Your StartupIf your startup has two founders instead of one, you can expect 30% more investment, triple the customer growth rate, and a higher likelihood of success. Clearly, going solo has its drawbacks. But when it’s time to bring on a co-founder, where should you start? Before you start the hunt…Startup Lessons9 min readStartup Lessons9 min read
